Wells Fargo Faces Multiple Whistleblower Complaints
Wells Fargo has far more on its hands than multiple customer complaints and lawsuits stemming from last year’s revelations that its retail branch employees opened up to 2.1 million bogus accounts, the National Law Journal writes. On Friday, the bank admitted that it’s dealing with “multiple” complaints related to whistleblower protection, according to the publication.
Wells Fargo says it’s facing multiple single-plaintiff complaints and whistleblower actions filed with the Department of Labor and state courts, according to the bank’s quarterly report to the SEC cited by the National Law Journal. The complaints allege retaliatory actions as a result of whistleblowers exposing aggressive sales practices at the bank, according to the publication. The DOL and Wells Fargo didn’t immediately respond to the National Law Journal’s request for comment about the exact number of whistleblower complaints. But the bank also said Friday that its legal costs could be more than $3.3 billion, according to the National Law Journal.
The reputational damage may be harder to assess — and it may affect Wells Fargo’s financial advisors too. Wells Fargo’s wealth management unit has taken a direct hit with the recent data leak allegedly exposing at least 50,000 private clients’ personal data, as reported previously.
Revelations about the multiple whistleblower actions come days after a new lawsuit against the bank alleging that it forced close to 250,000 clients into delinquency by pushing unnecessary auto insurance on those taking out auto loans. Now, regulators are looking into why Wells Fargo failed to refund insurance money to clients who had paid off their auto loans early, the New York Times writes, citing people familiar with the inquiry.
And last week the bank was hit with another lawsuit, this one alleging it overcharged clients in its merchant credit card processing division, Reuters writes. A Wells Fargo spokeswoman tells the newswire that the bank denies the claims and intends to fight the allegations.
Lawmakers, meanwhile, are calling for Wells Fargo executives to answer questions about the company’s persistent issues, ThinkAdvisor writes. Sen. Elizabeth Warren, D-Mass., and Rep. Maxine Waters, D-Calif. have requested that the Senate Banking and House Financial Services committees bring in Wells Fargo CEO Timothy Sloan and Chairman Stephen Sanger to testify in front of lawmakers after the August Congressional recess, according to the publication.